Bodies of water are a key foraging habitat for insectivorous bats. Since water is a scarce and limiting resource in arid environments, bodies of open water may have a structuring effect on desert bat communities, resulting in temporal or spatial partitioning of bat activity. Using acoustic monitoring, we studied the spatial and temporal activity patterns of insectivorous bats over desert ponds, and hypothesised that sympatric bat species partition the foraging space above ponds based on interspecific competitive interactions. We used indirect measures of competition (niche overlap and competition coefficients from the regression method) and tested for differences in pond habitat selection and peak activity time over ponds. We examined the effect of changes in the activity of bat species on their potential competitors. We found that interspecific competition affects bat community structure and activity patterns. Competing species partitioned their use of ponds spatially, whereby each species was associated with different pond size and hydroperiod (the number of months a pond holds water) categories, as well as temporally, whereby their activity peaked at different hours of the night. The drying out of temporary ponds increased temporal partitioning over permanent ponds. Differences in the activity of species over ponds in response to the presence or absence of their competitors lend further support to the role of interspecific competition in structuring desert bat communities. We suggest that habitat use and night activity pattern of insectivorous bats in arid environments reflect the trade-offs between selection of preferred pond type or activity time and constraints posed by competitive interactions.